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Shannon purchases a computer system costing $1,300 by taking out an 11% add-on interest installment loan....

Shannon purchases a computer system costing $1,300 by taking out an 11% add-on interest installment loan. The loan requires a 25% down payment and equal monthly payments for 4 years. How much are Shannon's monthly payments?

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Answer #1

price is $1300

down payment is 25% of 1300

down payment = 0.25(1300)

down payment = 325

.

loan amount is givenby

L = price - down payment

L = 1300 - 325

L = 975

.

r=11% = 0.11

n=12 for monthly payment

t=4 years

....................monthly payment

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